Chipotle CEO Describes A Seismic Shift In American Consumers
The burrito chain's same store sales soared by nearly 20% last quarter. Executives announced plans to keep expanding around the globe.
Chipotle is also taking market share from traditional fast food companies like McDonald's, which just reported that sales declined 3.3% in the US.
Founder and Co-CEO Steve Ells says consumers turning away from fast food companies enabled Chipotle's success.
"Over the last decade there has been a noticeable shift among consumers away from traditional fast food and casual dining chains, to fast casual restaurants as customers are looking for better quality food, served in a convenient format," Ells said.
Chipotle is known as a fast-casual restaurant, meaning that it doesn't offer full table service, but promises higher-quality food than fast food chains.
"The companies that have lost the most customers over the last decade are traditional fast food chains, while the biggest gains go to fast casual restaurants," Ells said.
Associated PressChipotle founder Steve Ells.
Ells cited a Consumer Reports survey which ranked Chipotle as the best restaurant. Many traditional fast food chains ranked near the bottom, with consumers citing "uninspiring food," as the primary reason.
"Despite offering dollar menus and frequent discounts, many of these chains also scored poorly in terms of value," Ells said. "The bottom line customer wants delicious food, served quickly and in interactive format and they are increasingly unwilling to compromise."
Ells said that his chain also ranks highly among millennials and teens, which bodes well for the chain's future.
"They are more concerned with how food is raised and prepared than previous generations and are willing to seek out and pay a little more for, something they recognize as better, better tasting, better for the environment and better for their wellbeing," he said.
The success of fast-casual chains like Chipotle has led to McDonald's changing its strategy to include more customizable options.
The chain has also started a series of videos to show how its American food is prepared.